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Based on Ambu A/S's ( CPH:AMBU B ) earnings update in March 2019, the consensus outlook from analysts appear fairly confident, as a 45% increase in profits is expected in the upcoming year, compared with the past 5-year average growth rate of 24%. With trailing-twelve-month net income at current levels of ø337m, we should see this rise to ø488m in 2020. Below is a brief commentary on the longer term outlook the market has for Ambu. For those interested in more of an analysis of the company, you can research its fundamentals here .
What can we expect from Ambu in the longer term?
Over the next three years, it seems the consensus view of the 5 analysts covering AMBU B is skewed towards the positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
This results in an annual growth rate of 26% based on the most recent earnings level of ø337m to the final forecast of ø836m by 2022. This leads to an EPS of DKK4.13 in the final year of projections relative to the current EPS of DKK1.39. With a current profit margin of 13%, this movement will result in a margin of 19% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Ambu, there are three important aspects you should look at:
- Financial Health : Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Valuation : What is Ambu worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether Ambu is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Ambu? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org . This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.